prepareTransactionRequest vs useSimulateContract

[rikotacards]

Is it correct to view prepareTransactionRequest is for native token? and useSimulateContract is for erc20, and other token standards?

Also, regarding the purpose, is it correct to say that the main purpose of these two, is to validate whether or not the transaction will be successful?

If I made a failed sendTransaction, it would still cost me gas. Hence, the purpose of prepareTransactionRequest, is to check whether or not the transaction will go through. As shown in the error:

Finally, useSimulateContract, does that interact with onChain data? and that's why its a bit slow to respond